CEO, P1 networks, Malaysia: “Once speed is there more innovation will come"

Michael Lai, CEO OF Malaysian operator Packet One is delivering the opening day keynote on Day One of the inaugural TD-LTE summit, taking place on the 23rd-24th April 2013 at the Fairmont Singapore Hotel, Singapore. Ahead of the show we speak to him about the challenges the company faces during its on-going transition from WiMAX to LTE.

Packet One Networks (P1), led by the irrepressible Michael Lai, has been one of the star players in the Malaysia region for data, coming from a standing start in 2009 to delivering a service that covers 55 per cent of the Malaysian population, with a subscriber base of over 500,000 customers.

However, as with all data focused operators that looked to capture market share in the previous decade, the technology it is based on is WiMAX. Clearly, the global trend is for operators to move away from WiMAX towards LTE, and P1 is no different. Indeed, it has been eagerly waiting for its opportunity to offer LTE to its customers and to take advantage of the growing LTE eco-system.

That moment came in early December 2012, when it was finally awarded the spectrum it needed. Speaking to Telecoms.com, CEO Michael Lai told us of his delight at being able to start its LTE journey and Lai said that P1 plans to use it to launch a TD-LTE service in the second half of 2013. “[Back in December 2012] we were awarded 20MHz of 2.6GHz spectrum, for which we are truly excited and we are very glad that our regulator has finally given us the go ahead to roll out TD-LTE.”

Of course, P1 wasn’t the only network to be allocated spectrum and the next 12 months promises to be challenging as it starts to face real competition in the supply of 4G data. “Next year there will be more of a level playing field from a technology perspective, so we will have to be a lot more innovative in terms of what we bring to market compared to what we have today,” Lai admits.

The transition from WiMAX to LTE won’t be immediate Lai says. The plan is to first overlayTD-LTE technology in its busiest areas before moving out to other areas of the region.” It will be two to three years before everything completely moves over to TD-LTE,” Lai predicts.

Considering the similarities in the technologies, the use of TD-LTE over FD LTE, makes a lot of sense for P1, Lai explains. Both technologies employ unpaired spectrum and the greater amounts of downloading compared to uploading that fits most people’s internet usage, fits well with the Time Division flavour of LTE, thus maximising the efficiency of the airwaves.

P1’s commitment to furthering the TD-LTE cause has recently been recognised by the fact that it has been added to the steering committee of the Global TD-LTE Initiative (GTI). Along with new members E-Plus and KT it now joins an exclusive club that consist of big players such as Bharti Airtel, Softbank, Clearwire, Vodafone and China Mobile.

This is indeed the reason why P1 is moving from WiMAX – to take advantage of a growing eco-system that brings with it economies of scale and the lower prices for devices. “The economies of scale will definitely depend on the movement of the biggest guys such as China Mobile,” Lai observes.

“While we can do a software upgrade on half of our current base stations right now, if we upgrade right away without the eco-system in place, the prices for [devices] will be US$500-1000, which is simply too high. So we will launch in the second-half of next year, depending on how fast the eco-system comes into place. It is going very well so far – we’ll be monitoring it very closely. By the second half of 2013 the dongles and the fixed wireless modem for TD-LTE will be there – it’s just a matter of the price at that point in time. And if China Mobile starting to officially launch next year, they will truly lower the prices of all TD-LTE devices.”

Michael Lai, CEO OF Malaysian operator Packet One is delivering the opening day keynote on Day One of the inaugural TD-LTE Summit, taking place on the 23rd-24th April 2013 at the Fairmont Singapore Hotel, Singapore. Click here to download a flyer.

As a data-only player dongles and fixed-line modems are a priority but Lai also has his eye on handsets.  “In the second half of next year, I believe that you will start seeing a small screen smartphone hopefully coming on board as well. But again, it’s what kind of volume it will have, and what kind of model.”

Is he hoping for the big one – a TD-LTE enabled iPhone?

“You can’t run away from the two major US platforms, which are iOS and Android. So to have TD-LTE on a multi-mode, multi-band iPhone or Samsung Android that are compatible with 3G and GSM would be ideal for us – at the right price point.”

As well as the price of devices, the pricing of data in an LTE world is one of the major controversy’s currently raging in the carrier world. Lai is clear though that unlimited data will not be on the cards for P1. “There will not be unlimited, all-you-can-eat [data], which I think most operators are moving away from. You need to manage expectations very well. In terms of value we are positioning LTE to continue to provide value for money in terms of cost-per-bit.”

Lai says that P1 that right now offers better value for money than its 3G rivals. “At the same price point [in Malaysia] 3G operators are offering 5GB, [while] we are actually offering our consumers 15GB right now. [And] we are currently doing it on a big screen, which is even more demanding. Over average volume of data per subscription is currently 17GB per month – mostly for fixed wireless modem [connections].

As a company that is consistently looking to innovate it’s no surprise to find that P1 is already looking at LTE Advanced. “It’s definitely on a roadmap to move from Rev 8/9 to 10,” Lai says. “I think the standard still needs to be finalised even though some vendors have claimed to have done trials on TD-LTE Advanced. But definitely there’s a roadmap. It’s exciting, as that’s when you’ll get theoretically 1Gbps. It’s fibre in the air, without fibre!”

Lai though is not just excited about speed for speeds sake. He also believes that superfast mobile speeds will bring innovative services along with them in their wake.

“When the network is there, at a super high rate, then a lot more innovation will come. And that’s proven over and over again. Take the Korean example; with the high speed broadband they have in the country a lot of innovation has happened in the last ten years. The same with LTE – once the speed is there a lot more innovation will come. Things you could not even image today will start happening.”

He’s confident though that the LTE adventure will be a positive one. “It will be a win-win for all I think.  A win for consumer, for the content provider, and a win for network provider as well. If we can continue to bring benefits for the subscribers and as the same time continue to do better then why not – the business model will start to happen.”